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Canberra Today 17°/20° | Friday, March 29, 2024 | Digital Edition | Crossword & Sudoku

Hopkins: Quality builders pay for ACT government’s lack of action

FOLLOWING the liquidation of Canberra building company Banyan Construction, Master Builders ACT is calling on the ACT government to improve Canberra’s building regulatory system.

The calls come after Banyan Construction, with debts of about $21 million, went into liquidation.

But, Master Builders ACT CEO Michael Hopkins, says the calls go back even further, about 10 years, and that the building regulatory system in the ACT has been in need of change for some time now.

“Last month’s collapse of Banyan Constructions highlights deficiencies in the ACT’s building regulatory system which have not been addressed by the current reform efforts,” Mr Hopkins says.

Master Builders CEO Michael Hopkins

The ACT government introduced laws late last year which were designed to prevent corporations from undermining the system and deliberately avoiding regulatory obligations by winding up their company.

“It’s evident that these new laws have not worked to protect subcontractors and suppliers from the collapse of Banyan Constructions,” Mr Hopkins says. 

“The MBA had warned the government that these reforms would not work, and instead should be focused on proactively avoiding building quality problems rather than dealing with problems after they occur.

“Sadly, the MBA’s warnings have been proven correct in the Banyan case.”

Mr Hopkins says the issue of licensing and registration was identified by building experts Shergold and Weir in their landmark Building Confidence Report (BCR) in 2018. 

“This recommendation remains incomplete in the ACT,” he says.

“Banyan Constructions builders license had been renewed by the ACT government year after year with the renewal process failing to identify problems with the company’s business practices. 

“When the MBA heard reports from subcontractors and suppliers of late payments it immediately reported these problems to the ACT Building Registrar.

“[Bit] it is not possible for the MBA to support our quality subcontractor and supplier members when the ACT government renews building licenses without adequate checking mechanisms.”

Now, Mr Hopkins says the ACT’s good quality builders, as well as home buyers, subcontractors and suppliers are paying the price for the unethical actions of a few industry members and the ACT government’s lack of action.

“The MBA expected the Banyan Construction collapse to generate calls to introduce project bank accounts or trust accounts, however, these reforms have proven ineffective in the jurisdictions they have been introduced,” he says.

“The MBA believes the best way to improve building quality and commercial conduct in the building industry is to implement proactive measures which either limit or restrict building licenses so problems are avoided, rather than introduce more regulation to deal with problems after they occur.” 

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